Reliance Cotton Spinning Mills Limited (RCML): FY24 Corporate Briefing Takeaways – By Taurus Research
Nov 21 2024
Taurus Securities
- Reliance Cotton Spinning Mills Limited (RCML) was incorporated in Pakistan on June 13, 1990 as a public limited company. The principal activity of the Company is to manufacture and sell Cotton, Polyester-cotton, and Melange yarn. The Company had a total installed capacity of 57,792 spindles and 31.6Mn pounds of yarn in FY24.
- Revenue increased by 33%YoY and clocked in at PKR 14.6Bn in FY24 compared to PKR 11.1Bn last year. Management noted that the increase was attributable to higher demand in both local and global markets. Gross margin increased by 1ppt to 16% in FY24. PAT increased by 41%YoY and was recorded at PKR 1.1Bn compared to PKR 839Mn last year. This was primarily due to a reduced reliance on long-term borrowings. As a result, EPS rose to PKR 115.2 from PKR 81.5 during the SPLY.
- Other income increased by 97%YoY and was recorded at PKR 156Mn compared to PKR 79Mn last year. This was driven by gains on disposals and reversals on workers’ welfare funds. Finance costs were 1.2x higher YoY and arrived at PKR 786Mn vs. PKR 350Mn. This was because of high interest rates. RCML’s taxes reduced by 28%YoY. These were recorded at PKR 119Mn compared to PKR 165Mn last year.
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